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Tuesday
Dec202016

Sungyong Kang: South Korea impeachment puts new anti-graft law in the spotlight

The Korean National Assembly agreed this month to impeach President Park Geun-hye based on the influence-peddling scandal of her confidante, Soon-sil Choi.

The main issue was whether the South Korean chaebols -- family-owned conglomerates such as Samsung, Hyundai and LG -- were buying influence or preferential treatment from the Park administration by providing financial benefits to Choi and her daughter.

Ironically, President Park supported the very anti-corruption reforms that form the backdrop for this grand corruption scandal.

The hotly debated new anti-corruption law is also called the Youngran Kim Law, named after the former supreme court justice who first proposed it. The law took effect in September 2016, one year after its enactment.

The Youngran Kim Law strengthened the anti-corruption movement in Korea, most importantly by criminalizing a public official receiving any benefits regardless of the existence of reciprocal favor (i.e. quid-pro-quo) of more than about $850 per occasion or about $2,550 in aggregate per fiscal year irrelevant to duties of the Public Official. At the same time, providing and promising such graft is also criminalized.

Due to strong public support for the law, both the government and business sectors are vigorously educating and training their employees to prevent them from being the law’s first target. With its inherent ambiguity and the lack of procedural court rulings, even persons who have no work relationship with public officials have changed the way they maintain their social relationship with public officials.

Indeed, as Youngran Kim mentioned in the interview Professor Andy Spalding and I carried out of him, this law became a “code of conduct,” successfully transforming a deeply rooted culture of business entertainment into a culture of “dutch pay.”
 
However, the positive behavioral changes in Korean society that resulted from the process of public debate on the Youngran Kim Law might not have permeated to the people with power and money. A deeply rooted culture of collusion between politics and the chaebols in Korea still lasts, and the history of corruption is being repeated.

At the National Assembly hearing in 1988 on a similar collusion scandal (the Ilhae Foundation scandal involving the former president Doohwan Chun) the chaebols gave testimony as witnesses. In the following investigations, neither the president nor the chaebols were indicted. And now, their children who inherited the money and management power from them testified as  witnesses at the National Assembly hearing in 2016 to probe the latest corruption scandal. Korea’s history of corruption is not to be repeated anymore.

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Sungyong Kang is an Inspector for the Korea National Police where he investigates high-profile white collar crimes. He is currently researching anti-corruption and anti-money laundering as an SJD fellow at Fordham Law after receiving his LLM at NYU Law.